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Problem Statement In America, we spend more money on health care and health insurance than we can collectively or individually afford and health outcomes are no better than in countries that spend half as much. Towards a fairer health care system We need a system that enables people to pay for the health care that they need. Health Savings Accounts Part of the solution can be through Health Savings Accounts. No, not the ones that take all your leftover money at the end of the year if you haven't spent it, that doesn't make any sense. Let people actually save up their money in Health Savings Accounts and over time people will build up the money they need for health care. Savings Mandate (not Insurance Mandate) Time and time again it shown that it is people making decisions about how to spend  Even with well meaning decision makers, working with OPM (Other People's Money) ensures that the money will get "spread around" for political reasons so that more people will benefit, thus increasing costs. A savings mandate would require people to save up a certain percentage of their pretax income each year until they reach the maximum threshold in their Health Savings Account. For example, take 3% of your income each year until you reach a maximum threshold balance of $30,000. So a person making $100,000 would save $3,000 per year. If they never used the account they would pay for 10 years before they reached the maximum threshold and then they would no longer be required to save until the balance dropped below the threshold. Give people the option of paying up to 15% of their pretax income to get to the maximum threshold faster. Think of it like an IRA (Individual Retirement Account), except if the money is spent on health care then neither the income or investment interest would be taxed. Insurance as an Option People can use their money to buy health care products and services directly or if they think they can get a better deal through insurance, then continue paying for medical insurance. Social Net So, what if you can't pay. Once your Health Savings Account is exhausted (or if you are so poor you can't afford to save anything) there should be a way to pay for health care that you absolutely need. The list of eligible services should be smaller than for what individuals can choose to spend on from the Health Savings Account, but you should still get something. But the system can't simply be open ended. There has to be a maximum amount or a rolling maximum, say for example $100,000 maximum over a 4 year period. Whatever Medicare/Medicaid can pay for without going into deficit. Supplemental Insurance Once people exhaust the social safety net, there should still be an opportunity for insurance companies to provide supplemental insurance above what Medicare/Medicaid can pay for. |